Fair Work Commission|2013-11-20|Before: Mr J

The applicant had been the subject of a few social media references.

[84] The evidence was that the applicant had been the subject of an allegation in late 2009 which was investigated by the Diocese and found to be false. In March 2012, an allegation was made against the applicant about events in the 1980's. He was stood down but returned to full duties on 27 April 2012. On 20 November 2012, at the meeting with Mr Passarello and Ms Wroughton which has been referred to earlier, the applicant was advised of another allegation arising from the 1980's. He was stood down on full pay. This was the position when he was called to the meeting of 5 December 2012 and until his dismissal. A copy of the letter from the NSW Police dated 5 February 2013 was tendered. It said "that the investigation has been completed and is now closed. No further action is contemplated by the Sex Crimes Squad concerning this allegation."

[86] It is understandable that the Diocese was influenced by the spotlight placed on it but I find that the decision to dismiss was influenced by the allegations against the applicant which were alive at the time of the dismissal. These allegations have not been pursued by the New South Wales Police. Of course none of the Respondent's witnesses admitted that this was the case, but it is impossible to come to any other conclusion having considered the totality of the evidence.

[87] Mr Passarello's answers in cross examination, set out below, are illustrative of what was surely in the minds of the Diocese and College representatives:

"I'm sorry. I mean, I meant prior to 5 December meeting. I beg your pardon. Yes, sorry. So that in terms of your trust of Mr King, apart from this question of the surf club stuff, which is the directions, you have no other reason to doubt him, have you?---Apart from the fact that he has been formally investigated by the police on two separate occasions and stood down, no.

No. Well, thank you for that, and exonerated, and the police have said "Case closed"? ---They said that earlier in 2012 but then it resurfaced in - so you're asking me a question about trust, it's in that climate of I have got a teacher who has been formally stood down on two occasions pending a police investigation, has been documented as Michael describes as naively in breach of protocols. Yes, by the end of 2012, if you're asking me the question of trust, then I would say that I would have less than full confidence in asking Michael to supervise children.

Yes, because you're saying you have less than full confidence in that because you're adding to it allegations which have been made against him, where the police have taken it no further. Have you heard of the presumption of innocence?---Certainly. However, we live in a different world in the terms of the supervision of children and the vulnerability of children and the exposure of children to risk and there is not the same - I don't believe, your Honour, the same definition of burden of proof in terms of that. If you asked me the question has my trust been affected then the honest answer is yes."

[88] I would not have found that the procedural deficiencies referred to were sufficient by themselves to render the dismissal harsh, unjust or unreasonable. However, I do find that insufficient attention was given to the applicant's long and dedicated service. I also find that the decision to dismiss, as opposed to other disciplinary action that could have been taken, was influenced by unrelated allegations in respect of which no Police action has been taken.

[89] For these reasons, and having considered each of the matters specified in s.387 notwithstanding that there was a valid reason for dismissal, I find that the applicant's dismissal was harsh, unjust or unreasonable. Accordingly I find the applicant's dismissal was unfair.

[90] Section 390 of the Act sets out the circumstances in which I may make an order for reinstatement or compensation:

"390 When the FWC may order remedy for unfair dismissal

(1) Subject to subsection (3), the FWC may order a person's reinstatement or the payment of compensation to a person, if:

(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and

(b) the person has been unfairly dismissed (see Division 3).

(2) The FWC may make the order only if the person has made an application under section 394.

(3) The FWC must not order the payment of compensation to the person unless:

(a) the FWC is satisfied that reinstatement of the person is inappropriate; and

(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case."

[91] I have already dealt with the issues at s.390(1)(a)-(b) above. I am satisfied the applicant was protected from unfair dismissal pursuant to s.382 of the Act and the Applicant was dismissed unfairly. Accordingly, I am required to determine whether to order the reinstatement of the Applicant or, in circumstances where reinstatement is inappropriate, an order for compensation if I am satisfied such an order is appropriate in all the circumstances.

[92] The applicant seeks reinstatement, continuity of service and payment of lost wages. Reinstatement to another school within the Diocese or to the head office were raised as alternatives.

[93] I am conscious of the financial and reputational damage suffered by the applicant but I have decided that reinstatement is inappropriate in this case.

[94] The applicant says that he believed he had 10 more years of teaching and stresses that he wishes to remain in the class room.

[95] The decision having been taken to dismiss, I do not think it is appropriate to now reinstate. Ms Wroughton and Mr Passarello gave evidence that the Diocese and the College have lost trust and confidence in the applicant. I consider this crucial in school/teacher/student relationship which I referred to earlier. They argued that they would not be confident that the applicant would follow directions to maintain appropriate boundaries with students.

[96] Ms Wroughton outlined a range of precautionary measures that would need to be put in place which would make reinstatement uneconomic and impractical. She also referred to the difficulties for the Diocese and College in reassuring parents and students given general publicity concerning the College in November 2012.

[97] The difficulties with reinstatement are best summarised in the evidence of Mr Passarello (who I found a credible and balanced witness) contained in his witness statement (Exhibit M12 at pages 13 and 14) as set out below:

"91. Personally, I have lost trust and confidence in Mr King such that I do not consider that I would be able to place the College's students (or any other children or young people) in his care.

92. Based on what I now know, I would not trust Mr King to follow directions given to him, or College policy, regarding maintaining appropriate boundaries between teachers and students.

93. Mr King's actions over an extended period of time have demonstrated to me that he is unwilling to follow child protection protocols. Based on what I now know, I consider it likely that he has deliberately failed to follow child protection protocols to suit his own ends.

94. I would no longer want to place Mr King in charge of students at the College as I would not consider that to be consistent with the College's duty of care towards the Students. That means, in practice, that he could not perform the duties of a teacher at the College.

95. Relevant to any possible reinstatement of Mr King as a teacher of the College is the fact that the College has recently had to deal with a series of allegations of child sexual abuse arising from the conduct (or alleged conduct) of a number of teachers at the College during the 1980s. Several of those teachers have now been charged with criminal offences, and one of those teachers has now pleaded guilty. By way of example, attachment 17 is a copy of two letters and a statement from the Bishop (dated 13 November 2012, 25 February 2013 and 21 June 2013) which have been sent by the College to the parents of all students. These charges arise from the investigations conducted by the NSW Police, which I have referred to above, and which also involved Mr King.

96. In my view the College Community would be likely to see Mr King as part of this issue and part of this problem. That would make his reinstatement even more difficult. It would also mean that any reinstatement of Mr King would undermine the confidence of the College Community in the College's ability to exercise its duty of care towards its students."

[98] Section 390(3)(b) provides that I may only issue an order for compensation to the Applicant if it is appropriate in all the circumstances.

[99] I have found that the applicant has been unfairly dismissed and that reinstatement is not appropriate in all the circumstances. I am satisfied that an order for compensation should be made.

[100] The applicant is almost 60 years old and he is unlikely to be employed as a teacher again certainly not on a permanent basis. He has suffered financial injury and reputational injury. Given his faith and close involvement with all aspects of the College, I accept that he has lost more than a job.

[101] Section 392 of the Act sets out the circumstances that must be taken into consideration when determining an amount of compensation, the effect of any findings of misconduct on that compensation amount and the upper limit of compensation that may be ordered provides:

(1) An order for the payment of compensation to a person must be an order that the person's employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

(a) the effect of the order on the viability of the employer's enterprise; and

(b) the length of the person's service with the employer; and

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

(g) any other matter that the FWC considers relevant.

(3) If the FWC is satisfied that misconduct of a person contributed to the employer's decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person's dismissal.

(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

(a) the amount worked out under subsection (6); and

(b) half the amount of the high income threshold immediately before the dismissal.

(6) The amount is the total of the following amounts:

(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and

(b) if the employee was on leave without pay or without full pay while so employed during any part of that period - the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations."

[102] The method for calculating compensation under s.392 of the Act was recently dealt with by a Full Bench of the Commission in Bowden, G v Ottrey Homes Cobram and District Retirement Villages Inc. T/A Ottrey Lodge, [2013] FWCFB 431 (Bowden). In that decision the Full Bench set out the order in which the criteria and other factors should be applied, taking into account authority under the Workplace Relations Act 1996 in Sprigg v Paul's Licensed Festival Supermarket, (1998) 88 IR 21 and Ellawala v Australian Postal Corporation, Print S5109 (Ellawala). I have adopted the methodology utilised in Bowden in determining the amount of a payment of compensation.

[103] I will now consider each of the criteria in s.392 of the Act.

Remuneration that would have been received: s.392(2)(c)

[104] The Applicant's remuneration with the Respondent was approximately $93,632 per annum on the evidence of the respondent. (Transcript PN3982)

[105] I now determine the period of time the Applicant would have remained employed by the Respondent, or would have likely remained employed with the Respondent, had he not been dismissed.

[106] The applicant stated that he wished to teach for another 10 years. Without his dismissal, it is likely that would have been the case.

Remuneration earned - s.392(2)(e)

[107] The uncontested evidence was that the Applicant had not had employment since the dismissal and therefore there has been no remuneration earned during the period since the dismissal. He was in receipt of New Start Allowance and had been forced to access his superannuation. I have taken this into account in assessing appropriate compensation.

Based on the Applicant's age and the allegations that have been made against him, I consider it unlikely he will earn income during the period between the period of the order for compensation and the actual compensation.

Other matters - s.392(2)(g)

[108] A broad discretion is given to the Commission to consider other matters. In the circumstances, I consider this is a case in which the maximum compensation should be awarded.

Viability - s.392(2)(a)

[109] Given the nature of the employer, an order for compensation will not affect the viability of the business.

Length of Service - s.392(2)(b)

[110] The Applicant had over 37 years service with the Respondent.

[111] The Applicant's length of service, in fact, reinforces the need for maximum compensation.

Mitigating efforts: s.392(2)(b)

[112] In considering whether the Applicant has taken steps to mitigate the loss suffered as a result of the dismissal I should take into account whether the Applicant acted reasonably in the circumstances, (Ellawala).

[113] I find that the Applicant has made efforts to mitigate his loss suffered as a result of the dismissal.

Misconduct: s.392(3)

[114] Given that I have found there was a valid reason for the applicant's dismissal, it follows that the applicant's misconduct contributed to the dismissal. I must reduce the compensation to take account of this factor. I have decided that the reduction should be a small amount. I do so not because of the nature of the misconduct but rather that to do otherwise would not give appropriate recognition of the applicant's length of service, dedication to the College, future career prospects and economic and personal effects, including reputational damage, of the termination. I therefore reduce the compensation by $5,000 on this count.

Shock, Distress: s.392(4)

[115] I note that the amount of compensation calculated does not include a component for shock, humiliation or distress.

Compensation cap: s.392(5)

[116] I must reduce the amount of compensation to be ordered if it exceeds the lesser of the total amount of remuneration received by the Applicant, or to which the Applicant was entitled, for any period of employment with the employer during the 26 weeks immediately before the dismissal, or half the amount of the high income threshold immediately prior to the dismissal.

[117] The high income threshold component is $64,560.

[118] The amount the Applicant would have earned, or to which the Applicant was entitled, for the 26 week period immediately prior to the dismissal was therefore approximately $46,816.

[119] The amount of compensation I will order does not exceed the compensation cap.

[120] I will order the Respondent to pay to the Applicant an amount of $41,816.

[121] I am satisfied that the Applicant was protected from unfair dismissal, and that the dismissal was unfair and a remedy of compensation is appropriate. In accordance with s.381(2) of the Act, I am further satisfied that each party has been accorded a 'fair go all round'.

[122] An order (PR544735) will be issued with this decision.

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King v Catholic Education Office Diocese of Parramatta [2013] FWC 8914 (20 November 2013)

[26] The ambit of the conduct which may fall within the phrase 'harsh, unjust or unreasonable' was explained in Byrne v Australian Airlines Ltd [1995] HCA 24; (1995) 185 CLR 410 at 465 by McHugh and Gummow JJ as follows:

[33] The High Court in State of NSW v Lepore & Ors [2003] HCA 4; (2003) 221 CLR 511 considered at length the duty of care owed by a school to its students. A school is vicariously liable for the actions of an employee, even if occurring away from the workplace or outside normal working hours, if there is sufficient connection with authorised acts during the course of employment.

[37] I am under a duty to consider each of these criteria in reaching my conclusion, Sayer v Melsteel [2011] FWAFB 7498.

King v Catholic Education Office Diocese of Parramatta [2013] FWC 8914

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Judgment (86 paragraphs)

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Cases Cited (10)

King v Catholic Education Office Diocese of Parramatta [2013] FWC 8914 (20 November 2013)